There is huge potential here, but it is only the tip of the iceberg. The EY analysis suggests the green projects identified represent only 10% of those that are under development in Europe.
Around 30% of the projects selected have been developed by start-ups and SMEs, and many involve innovative solutions such as sustainable mobility, green hydrogen, land remediation and low-carbon construction.
More than 20% of the projects identified are small scale, requiring investment of up to €5m. Supporting these innovations could help build future European markets for green projects in which EU and international companies can grow and take a leading role.
There is huge potential here, but it is only the tip of the iceberg. The EY analysis suggests the green projects identified represent only 10% of those that are under development in Europe. This means that the value of the entire EU pipeline of green projects could be well over €1t, with the potential to make substantial reductions in emissions and return more than the 12 million full-time jobs previously lost to the pandemic.
A green recovery beyond Europe
And, of course, this is not just a European issue. Emissions from the 27 EU member states plus the UK comprise only 8.7% of global output. There is ample opportunity across the globe to create a green recovery.
A similar EY study from December 2020 covering Asian countries, also sponsored by the European Climate Foundation, found more than 800 projects that had the potential to create social, environmental and economic value in the next two to three years.
These projects covered five sectors (renewable energy, energy storage, energy efficiency, electric vehicles and grid infrastructure) and eight countries (Indonesia, Japan, Malaysia, South Korea, Taiwan, Thailand, The Philippines and Vietnam). They will require over US$300b of public and private investment and have the potential to support 5.3 million jobs.
The new US administration is also expected to highlight green initiatives. President Joe Biden has proposed a $2t climate and jobs plan involving clean infrastructure and other climate solutions. One of his first acts as president was to sign an executive order for the US to rejoin the Paris Climate Agreement.
Combined with China’s commitment to achieve net-zero emissions by 2060, the stage is set for innovation and delivery.
COP26 could be a signal for the future direction of the global economy – with reinvigorated global cooperation the catalyst for a green recovery that creates sustainable jobs and addresses the challenges of public health, climate change and biodiversity loss.
Cooperation at COP26
The green recovery is also expected to be a key theme of the 26th summit of the UN Conference of the Parties (COP26), which is due to take place in November 2021 in Glasgow, but may be postponed until 2022. Delayed by the COVID-19 pandemic, the summit will bring together delegates from around the world to discuss global responses to climate change.
According to Alok Sharma, COP26 president, “COP26 can be a moment where the world unites behind a clean resilient recovery.” Time will tell, but COP26 could be a signal for the future direction of the global economy – with reinvigorated global cooperation the catalyst for a green recovery that creates sustainable jobs and addresses the challenges of public health, climate change and biodiversity loss.
The economic recovery from the COVID-19 crisis has the potential to accelerate a socially just transition to a sustainable future – and the EY research shows that enough environmental projects are available. There is a window of opportunity to seize something positive from the severe health and economic experiences of the past year. It’s an opportunity that should not be wasted.
A new EY report highlights 1,000 infrastructure projects in Europe that could stimulate a green recovery from the COVID-19 pandemic. The projects will require around €200b of public and private investment but could support three million jobs. Similar opportunities are available in Asia where an EY study found more than 800 suitable projects. The green recovery is also expected to be a key theme at the UN climate conference (COP26) in November 2021. By building back better, it may be possible to seize something positive from the severe health and economic experiences of the past year.